2020 has definitely been a strange year…
It all started out fairly normal. Then in March after Donald Trump announced, on that infamous TV broadcast to the nation, a closing of borders to Europe, Costa Rica slammed its own doors shut, right in the middle of tourism “high” season…
And things have pretty much been that way since, with only a partial opening to certain U.S. States and other countries, whose citizens must comply with a laundry list of entry requirements, including a negative COVID test within 72 hours of arrival and health insurance to cover you in case of COVID contraction while in country. A total opening to all 50 U.S. States was recently announced for November 1. And, surprisingly, they have just announced that the requirement for a negative COVID test has been dropped…
And this is coming at a time when Costa Rica’s COVID cases are certainly not experiencing any downtrend. While early in the pandemic Costa Rica was touted for being a shinning success with one of the lowest fatality rates on the planet, it now has one of the highest infection rates in Latin America. Nevertheless, its current case fatality rate, at around 1.2%, is still less than half that of the U.S. at 2.6%.
Will things get back to some semblance of normal anytime soon?
We shall see, but on many fronts, highly doubtful.
The closing of Costa Rica’s air, land and sea borders certainly has had a negative impact on the economy. Costa Rica’s unemployment is now the highest it has ever been in recorded history. The coastal areas, with economies that are largely based on tourism dollars, have been hit particularly hard.
The Costa Rica government was already in a fiscal deficit before COVID and it has only gotten worse. Recently the Alvarado administration announced that it had accepted a loan from the IMF (International Monetary Fund) of $1.75 billion. In exchange, certain fiscal adjustments were required, which came in the form of a package of tax increases. The impact of these taxes would be largely felt by higher income earners. Nevertheless, a populist group known as the Movimiento Rescate Nacional (National Rescue Movement) announced in protest a series of road blockages along key commercial traffic arteries throughout the country. This persisted for over two weeks and in the end they turned violent, as protesters clashed with police.
Like I said, 2020 has been a very strange year.
I predicted way back at the outset of this whole mess that the COVID pandemic, coupled with the political division in the U.S., which has reached a fevered pitch as we approach the upcoming November 3rd presidential election, would send a wave of expats wanting a more peaceful existence in Costa Rica. I said that this could ignite increased demand for Costa Rica real estate…
Well, I hate to say I told you so, but I was right!
Speaking from my own experience, I have closed two sales within the last 30 days and currently have 4 more under contract that will close prior to the end of 2020. More offers are on the way!
I can only scratch my head (and count my blessings) that in a year that has turned dark and ugly in so many ways, the demand for Costa Rica real estate is one bright light shining through amidst the persistent cloud cover!
The economic woes Costa Rica is facing have taken a toll on its currency. The colon has breached the 600 to $1 USD limit and the rate is still climbing (meaning the currency is de-valuing). This is, of course, both good and bad. It can be good for gringos wanting to buy Costa Rica assets with dollars. However, ultimately, if not stemmed, it could spell disaster for the general Costa Rica economy. Luckily, Costa Rica still has a fairly healthy reserve of dollars it can use to shore up its currency, for the moment.
I can’t see the surge in real estate demand abating anytime soon. I’ve got real estate clients on both sides of the political divide. The Trump supporters swear that if Biden wins, they’re moving. The Biden supporters say the same regarding a Trump victory. So, I guess I’m safe in either regard.
By the way I did already vote by absentee ballot and I can tell you for 100% certain that regardless of who wins, I ain’t going nowhere!
Real estate is flying off the market right now. So, if you’re thinking about a move, I wouldn’t expect prices to get any lower in 2021. In fact, quite the opposite might very well occur as inventories of listings grow thinner.
I’m getting a lot of requests for mountain properties, with home, acreage, privacy and a cool climate altitude. People seem to be tired of the rat race and are ready to live a more laid back and self-sustainable life-style. Costa Rica definitely offers that. And, as I’ve often said in this blog, there’s no better place than our southern zone mountains. Here you can live amidst incredible flora and fauna, at an altitude offering a near perfect climate, and be less than an hour to the ocean.
Of course, if you’d prefer to be 10 minutes from the waves, we’ve got you covered in the southern zone for that as well.
I have read online some tales of woe (usually in some Costa Rica expat group) that perhaps Costa Rica has seen its better days and that dark times loom ahead. While I don’t have any crystal ball and there are certainly challenges moving forward, I believe Costa Rica will be just fine. After all, the things that draw people to this country, both for vacations and to actually live as expats, haven’t gone away. In fact, this whole COVID crises has given nature some needed breathing room. Costa Rica is just as beautiful as ever, even more-so.
So, if you’ve been dreaming about an expat life in Costa Rica, there’s no better time than now to make your move…
And I am here to help!